A real world example of a wealth producing network of contacts

The crucial key to any strategy for e-commerce or e-business is in finding or creating the input and output solution points. These can be seen as two lists of contacts: one representing the demand side; the other representing the supply side. The wealth creation process is in linking these two sides together efficiently. The two solution points can be thought of as containing pointers: one Solution Point with pointers pointing to people upstream and the other with pointers pointing to people downstream.

Because we can view this as an abstraction, this simple model can be applied to all possible situations. It applies to the expert or specialist: where one side represents contacts in the worlds of special knowledge that supplies the information needed to continually update the expert's or specialist's knowledge base. The other side will represent contacts to appropriate people who might have a need for the particular expertise provided by the specialist.

It will apply to the middlemen who will also each need two sets of contacts. One set linking them to the levels of organisation nearer the supply side: the experts, specialists or the prime manufacturers. The other set with contacts linking them nearer to the demand side: the customers and the clients.

These nodes and links can be thought of as occurring in a vast, complex network of inter-connected people that span between the prime sources and the ultimate consumers. Each person in the network having to find or create their own input and output Solution Points made up of human contacts.

Places like trade shows, conferences, Internet discussion forums, etceteras, are easy places to make initial contacts. Quite often though, especially in the environment of the Internet, populations have to be searched and filtered to be able to find suitable people to make up an optimum Solution Point. This necessitates setting up many mutually co-operative associations; often requiring a lengthy process of playing tit-for-tat to bring the associations to fruitful maturities.

An example of Solution Point building that readily comes to mind is one that once gave me a regular supply of old fur coats. Old fur coats may seem a long way removed from Internet communication strategies, but, bear with it, it's the abstraction that counts. Solution Point building is always a first step when trying to move out of the dreaded square one position.. After I sold out my head shop business in the early 1970's. I invested all the money I had into a property development at La Manga in Spain. This is now an established holiday resort, but, at the time, building had just begun and it seemed an ideal place for an entrepreneur to be investing.

Being an optimist and a gambler, I geared up my money (used it as part payment) to build a shopping mall consisting of 42 small boutiques designed to appeal to holiday makers. Unfortunately for me and my money, the Arab-Israeli war intervened, oil prices were hiked up four fold, all the world's currencies went into chaotic turbulence and the tourist industry and the developments that depended upon them were killed stone dead. I lost everything I had in that debacle and found myself back in London with nothing more to my name than an ancient old motor car that I'd bought with the last of my money.

Fortunately, I still had many friends in London. One of them loaned me some money and rented me a small trading space in his shop which was located in a side road off of Carnaby Street. The condition of the offer was that the space would be available only after the end of September, when the tourist season had ended. As this was in July, I had about two months in which to organise an off season business.

In many ways, this is very similar to the situation faced by many would be entrepreneurs wanting to start an e-commerce business from a simple Web site. A small area to trade from, a small capital and no idea as to what to sell. There would be very little passing trade, so, unlike the costume jewellery counter in Hyper Hyper, there would be too few people to use as a guide as to what to sell. This meant I had to come up with a very unique, speciality product.

Although I was stuck in a particular demand side Solution Point, it wasn't too bad a situation because even though the tourist trade had slowed right down, Carnaby Street is in a highly populated business area. Many people could easily get to the shop if only they knew it existed. However, as passing trade was slow, I knew I'd have to sell a product that was unique enough for people to want to come specifically to the shop to buy it; I needed regular customers and a product so unique that its whereabouts would be spread by word of mouth. Not too dissimilar to the start up situation faced by many small Web site traders.

Such a product wasn't easy to find. If it were, then it would probably have been stocked by some of the hundreds of other shops in the area who were constantly on the look out for off season lines. I needed something that was not easy for other retailers to get hold of.

Going through the various possibilities, I decided upon selling old fur coats. At the time these were quite fashionable, and I'd had experience of selling them before. Also, they were a seasonable product with the season starting in October. All things considered, especially the small amount of capital I had available, it seemed a reasonable choice. All I had to do was to set up a system of supply. but, this was easier said than done. Old fur coats were such a specialist product there were no ready made Solution Points. There was no equivalent to Berwick Street: a place where many wholesalers would be selling old fur coats.

I knew the only way to get old fur coats was to go around all the little brick-a-bat and used clothing stores. They occasionally had the odd fur or two to sell. There are not many of these but there is usually at least one in every town. I then set out in my rusty old car, to search out these stores.

I divided the whole of the south of England into areas and each day drove around one of the areas looking for these small stores. At each one I found, I'd ask if they had any furs. As this was in July and August of 1976, the hottest summer on record, my request was greeted with some amusement, but, I told them what I was doing and said I'd be returning the following month to see if they'd been able to buy any in by then.

For six weeks I bought practically no furs at all. I travelled at least two hundred miles each day in the blazing heat and achieved not much more than a list of possible contacts. However, after I'd covered the whole of the south of England, I started to return to the stores I'd visited. Some of these had found furs for me. I bought all the furs I was offered, at the asking prices and without any quibble (except if they were asking silly high prices ). Each purchase I viewed as the possible start of a mutually profitable, co-operative association. I even bought furs that I knew would be unsaleable in order to establish a relationship.

When I made a second return visit to the stores, some had made an effort to buy in furs specially for me. Again I bought all they had and on my next round of visits, I called only on those stores that had made an effort to get furs for me. By the end of September I'd used up all of the money I'd borrowed.

Fortunately, the furs started to sell quite well and I could start buying again and was able to continue visiting the stores on a regular basis. Several of them were now going out of their way to find furs for me. Soon, I could concentrated on just these and as their confidence increased that I would return to buy all of their stock they began to put more effort into getting hold of furs within their areas. It wasn't long before I could rely on just these handful of suppliers and so reduce my buying time to just one day a week.

The essence of this venture has many lessons for e-commerce. I'd simply used a tit-for-tat strategy as I visited and revisited these contacts. Those that responded to my co-operative tactics with co-operation I could build up relationships with. As the co-operative encounters continued they became progressively more beneficial for each of us. I, for my part, was visiting them reliably every week and paying them what they asked and they in return were getting more and more confident and increased their efforts.

The net effect was a system of co-operation where I'd created my own people Solution Point. In effect I'd built a virtual team of conscientious workers who were searching the south of England for furs for me. There was no need for me to put some complicated reward system into effect. There was no need to motivate them, find ways to make them more efficient or check up on how hard they were working. It was a leader less system that had evolved out of a tit-for-tat strategy being used by all of the participants.